Canada to lift restrictions on foreign ownership in telecom sphere

Telecom Lead Canada: The Canadian government is going to
lift long-held restrictions on foreign ownership of wireless companies, as
it looks to spur competition in Canada’s fast-growing wireless sector.


The move will allow non-Canadians to own 100 percent of
firms with a market share of 10 per cent or less.


Furthermore, the decision could pave way for global
telecommunications giants to enter the Canadian wireless market, which is
presently dominated by three big incumbent operators that hold a combined 95
percent share of the market.


Bell Canada Enterprises Inc., Rogers Communications
Inc., and Telus Corp are the three big incumbent operators of the Canadian
market.Currently, direct and indirect foreign investment in telecom companies
is restricted to a combined total of 46.7 per cent.


The government will also place limits on what the big
incumbent companies can acquire in its new auction of wireless spectrum – which
will allow telecom firms to offer more video and broadband services.


“We are bringing the tools here to ensure we achieve
our policy goals – increased competition, robust investment and innovation, and
access to the best technology,” said Christian Paradis, Industry Minister.


Industry Minister Christian Paradis added this
exemption from foreign investment restrictions would continue even if these
companies naturally grow to occupy more than 10 per cent of the market, but
would not if these firms get bigger through mergers or takeovers.



The measures I am outlining today will ensure the timely availability of
world-class wireless services at low prices for Canadian families, including
those in rural areas,'” Paradis added in a statement.



The minister also said the government would auction off 700 MHz wireless
spectrum in the first half of 2013. The changes to the auction rules will let
at least four companies obtain a presence in each of Canada’s 14 license areas,
effectively making one block available for one of the smaller players.

 

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